ConnectWise's sale to private equity firm Thoma Bravo, announced Monday, has naturally led to questions swirling around the channel as to what the future holds for the MSP vendor and its partners.
Acquisitions always bring a degree of uncertainty, but when a company is run by someone so strongly associated not only with its success, but its very identity, how does that impact its customers and, in this case, the channel more broadly?
As Arnie Bellini steps aside from his role of CEO at ConnectWise after 37 years at the helm, we speak to MSPs across the country to get their take on the acquisition and what the future looks like for ConnectWise and its customers.
Here are the top five points we heard from MSPs on the ConnectWise acquisition:
It seems that ConnectWise did an excellent job of keeping its intentions quiet. MSPs told us that the news was "surprising as hell" and a "total shock". Members of the MSP peer group IT Nation Evolve, formerly known as HTG and acquired by ConnectWise in January 2018, were surprised that even they didn't catch wind of Bellini's intentions.
"I totally was not expecting it," Raj Goel, CTO of New York City-based MSP Brainlink and IT Nation Evolve member, told CPI.
"Arnie and ConnectWise was the last company I thought would sell out or get acquired. Arnie said for years that they are debt free and privately owned. I was surprised to learn that they put this plan in motion five years ago because not once was there even a rumor of them getting bought up by private equity or being sold."
Goel's sentiment was echoed by Tim Lambdin, president at Midland, TX-based Flexnet Networks, who said the news came as a "total shock".
"I was there last week, there was no mention of it. I get back this week, and we get the news."
One MSP who was slightly less surprised was Greg Zolkos, president and CEO at Tampa, FL-based MSP Atlas Professional Services. He told CPI that an acquisition was in the cards.
"It's something that we knew was inevitably going to happen. It seems like it was very well prepared for. Over time we've seen some of the changes in the product names, the branding around those and the role of those products and integration, so it's probably something we started noticing a couple of IT Nations ago, if you will. It was a matter of time."
2) More money
The general feeling among MSPs is that the cash injection could open up more avenues of expansion for ConnectWise and partners.
Charles Berry, CEO at Melbourne, FL MSP Total Care, told CPI he hopes that ConnectWise will continue to "have the channel's best interests at heart".
"I think if they maintain [Arnie's] vision, there's so much more that can really happen," he said.
Lambdin agrees. He told CPI that the new investment will take ConnectWise "to a whole new level" that Flexnet Networks is "very, very excited about".
3) Price hikes and reduced support?
Bellini noted Monday that ConnectWise will be laying off approximately 110 staff members as a result of the sale, while creating 70 new jobs. And MSPs across the country pointed out a number of other potential changes that could materialize.
"I suspect, despite what the press release says, there are going to be changes in pricing," Goel said. "I expect price increases and I expect to see a decrease in service or support, and I expect management stupidity and a lack of focus."
Berry noted that after the news was announced on Monday he had read on MSP forums that there were some players who were "jumping ship" as a result of the news.
However, representatives for ConnectWise said they didn't believe this to be the case, and Lambdin told CPI that concerns around management not having the same focus as Bellini "is a caution, but shouldn't be a fear".
Zolkos noted that his only concern is that the product and the development side of ConnectWise might take a backseat for a while, something he described as typical of acquisitions of this nature.
4) Lacking direction?
On the one hand, MSPs are excited about the cash investment a PE firm will bring to ConnectWise. With "money being no object", as Berry put it, there is the opportunity for more resources and greater investment in the product.
"That may be something that brings a lot of unknowns, but none of the unknowns that I can think of really have a downside," he said.
However, the PE influence raises concerns for some. "I think ConnectWise is going to become more broad based and more unfocused," Goel said, voicing concerns about potential future acquisitions and the industry more broadly losing its identity in light of vendors like ConnectWise becoming part of a "corporate" parent company.
5) Decision makes sense for Bellini
It's fair to say that there are very few figures in the MSP space that are held in higher esteem than Arnie Bellini. "A godfather of the channel", as Goel described him, Bellini has always been known as a pioneer who genuinely cares about the channel.
After 37 years leading ConnectWise, Bellini's decision to step aside is the one point that all commentators were in agreement on.
"I'm personally glad and happy for Arnie - 37 years is a long time to run anything. I couldn't be happier for Arnie that he's found a way to exit and it's going to a PE firm that at least knows this industry," Goel said.
Lambdin agreed. He pointed out that finding a successful exit strategy is what most aspire to.
"I'm happy for Arnie. I think that that's what we're all looking to build - something great to be able to sell it. And isn't that what we're all about waking up to do every day? I know I am."
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